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Like MMS, Raghuram Rajan is likely a Manchurian Candidate. His loyalties lie with his Green Card. He displays the same petulance as the Lutyens elite when they're told to vacate their ill-gotten bungalows

As an ex-central bank governor, he should know better when to speak and when not to. Mumbai was curiously quiet during the UPA days, but became sort of hyperactive during NDA. And now this publicity tour for discussing monetary policy almost right after he left Mumbai leaves a poor taste. By contrast, Mr. Patel has been discreet and not talking about non-monetary stuff in some lecture tour, etc. I suppose the Amerikka halo provides the chutzpah in Rajan's approach - people will generally give him a free pass on talking out of turn, and crash on a home grown guy like a ton of bricks.

Rajan should have waited another year or two before commenting about these things - whatever monetary policy decisions he had taken would have more or less run its course and any comments at that time would not have caused much harm. This however, is not done.

Prem Kumar wrote:Like MMS, Raghuram Rajan is likely a Manchurian Candidate. His loyalties lie with his Green Card. He displays the same petulance as the Lutyens elite when they're told to vacate their ill-gotten bungalows

Apologies the video is in Hindi, but it exposes MMS that a French newspaper Le Monde had printed during Chandrashekhar's PMship that "no matter who forms the next govt, Manmohan Singh will be the next finance minister :

Raghuram also IMF guy, and you can see how rNDTV CNBC all go orgasmic at his every utterance.

^^^His statements border treason. Better yet, cancel his passport and report it to the Trump administration and ask ICE to deport him to India. Then arrest him for sedition. Seize all of his assets and his family's too. Let him rot in jail. This fellow is far more dangerous to the union than that blowhard Arundhuti Roy. If you give RR a break then all sorts of assholes will create unnecessary trouble.

Mort Walker wrote:^^^His statements border treason. Better yet, cancel his passport and report it to the Trump administration and ask ICE to deport him to India. Then arrest him for sedition. Seize all of his assets and his family's too. Let him rot in jail. This fellow is far more dangerous to the union than that blowhard Arundhuti Roy. If you give RR a break then all sorts of assholes will create unnecessary trouble.

The GoI can't cancel passports at will, let alone seize property. I'm sure Raghuram Rajan's relieved that there are those on this forum who'd rather let him be.

Mort Walker wrote:^^^His statements border treason. Better yet, cancel his passport and report it to the Trump administration and ask ICE to deport him to India. Then arrest him for sedition. Seize all of his assets and his family's too. Let him rot in jail. This fellow is far more dangerous to the union than that blowhard Arundhuti Roy. If you give RR a break then all sorts of assholes will create unnecessary trouble.

When did we become Pakistan?

All this stuff about people being in the IMF's pocket is hogwash. IMF has a set of rules, and they have the money. If you want to play a different model, please raise your own money and monetary system which can be used to fund your imports and pay for your exports. If that is Bitcoin, and you have all the computers to mine money, so be it. Talking about fiscal prudence, transparency and good governance (incidentally a lot of things like environmental and human audit of projects was included, over the years, due to the efforts of India based activists) is a good thing. A tough banker is actually your friend - the pawn broker down the road who encourages you to borrow and spend is not. And then we need our own oversight to ensure that every dollar borrowed is used to the last drop.

Whenever we have the need and an opportunity presents itself, we diversify our source of funds. FDI are hot money which can reverse at the slightest challenge. We have ADB, AIIB and NDB - the latter 2 being in Chinese hands. Japan is funding the bullet train project (their interest being in making their technology sticky, and in long-term wealth preservation) to a large sum of money. Companies have also borrowed heavily from abroad when the numbers are advantageous to them - for instance Indigo and even Air India has leased several aircraft from Chinese controlled consortiums.

So we have a pretty diverse basket of borrowers and yes we play one off against the other. The Central Bank (RBI) has the duty of preserving sanctity of the rupee (while balancing growth and inflation), and they have largely delivered regardless of pressures. Today the problem is not RBI, it's that private industry is unwilling to borrow and invest.

^^^It has nothing to do with RR being a good banker. No one is doubting that, but openly getting into politics, and that too on foreign soil, is a big no-no. It borders treason for a former government official. It's one thing to say things in private or quoted in an interview, it is entirely different giving speeches on it outside India. As an example, there are a lot of former US Gov. people who don't like Trump's policies, but they don't get into partisan politics on foreign soil.

The only saving grace here is that RR stupidity is recorded for posterity on YouTube and becomes a disqualification for any future govt. office in India. However Con-gress party may still invite him.

Mort Walker wrote:^^^His statements border treason. Better yet, cancel his passport and report it to the Trump administration and ask ICE to deport him to India. Then arrest him for sedition. Seize all of his assets and his family's too. Let him rot in jail. This fellow is far more dangerous to the union than that blowhard Arundhuti Roy. If you give RR a break then all sorts of assholes will create unnecessary trouble.

The GoI can't cancel passports at will, let alone seize property. I'm sure Raghuram Rajan's relieved that there are those on this forum who'd rather let him be.

Sure the GoI can. The passport number can be made invalid. Any visas given on it by default become invalid. I would go a step further and cancel RR's wife and childrens' passports too, although my guess is that his children were born in the US as RR's wife is a professor at Univ. of Chicago too.

RR is definitely being partisan while abroad, but it's better to let him have his day in the sun than persecute him. This is not the first person nor will it be the last to wash dirty laundry in public, and that's how it works for us. As an economist and person with political views, the only durable counter to him will be if the economy succeeds in turning the corner, adding jobs and bringing about social stability.

In other words, he is an academic with strong and politically backed views. Prove him wrong.

KrishnaK wrote: The GoI can't cancel passports at will, let alone seize property. I'm sure Raghuram Rajan's relieved that there are those on this forum who'd rather let him be.

Sure the GoI can. The passport number can be made invalid. Any visas given on it by default become invalid. I would go a step further and cancel RR's wife and childrens' passports too, although my guess is that his children were born in the US as RR's wife is a professor at Univ. of Chicago too.

….Now, it has been held by this Court in Satwant Singh’s case (supra) that ‘personal liberty’ within the meaning of Article 21 includes within its ambit the right to go abroad and consequently no person can be deprived of this right except according to procedure prescribed by law. Prior to the enactment of the Passports Act, 1967, there was no law regulating the right of a person to go abroad and that was the reason why the order of the Passport Officer refusing to issue passport to the petitioner in Satwant Singh’s case (supra) was struck down as invalid. It will be seen at once from the language of Article 21 that the protection it secures is a limited one. It safeguards the right to go abroad against executive interference which is not supported by law; and law here means ‘enacted law’ or ‘State law’ (Vide A.K. Gopalan’s case). Thus, no person can be deprived of his right to go abroad unless there is a law made by the State prescribing the procedure for so depriving him and the deprivation is effected strictly in accordance with such procedure…..

Mort Walker wrote: It borders treason for a former government official. It's one thing to say things in private or quoted in an interview, it is entirely different giving speeches on it outside India. As an example, there are a lot of former US Gov. people who don't like Trump's policies, but they don't get into partisan politics on foreign soil.

All your personal opinion and pretty arbitrary at that. There's no law against it.

Aditya_V wrote:Its worthless, as time passes there is no option but to let economy pick up and make him useless. Media is the oxygen which these people survive on. Once you take that away they become an Aam Aadmi.

In my opinion if RR had not quit from RBI, Indian economy and Modi govt would have been much better off today. People of his caliber, skills and experience are so rarer to find that you can count them on your fingers. Panagariya is also leaving for similar reasons that is tenure and cushy life of a hifi massa professor. Anyhow no one's irreplaceable and late in his tenure, his celebrity status had made him more of a liability than an asset. RBI governor's job in most part is to give speeches and mold market orientation by communicating policy directions but until Rajan DDM had not paid much attention to boring RBI Govorner's events. Rajan should have blocked off the poisonous media once things started to get out of hand ( like Gen VK Singh did). The New governor has drawn an iron curton around him to preserve space to function.

1. The RBI governor's independence on monetary policy which helps to balance the two sometimes conflicting goals - price stability and growth. I agree with RR that price stabilty is more important in India. Our problems are supply side not lack of demand. So growth with come by reforming factor markets, building infrastructure, better tax administration and better governance - ie supply side. Lower interest rates are not the solution. There is a common mistake in many economies of asking monetary policy to do the work of fiscal policy. Thats wrong. And to the extent RR stood up to that it was good. There is always a healthy tension between the finance ministry and RBI. Its good. He was also right in calling for reform of bank balancesheets and crony capitalism which has riddled PSU banks with unperforming corporate loans. There has been HUGE corruption over the last 10-15 years at PSUs with full orders from the govt. JP, Mallaya etc are just two manifestations of that.

2. But his comments on non RBI and monetary policy issues like tolerance etc were wrong. Central Bank governors are expected to be 100% politcially neutral. Infact a good governor anyhwere in the world is a quiet one, from a media perspective even a lack lustre one. This is where he did a lot of damage.

RR is a media-whore and he loves being in the limelight. Unfortunate truth. And no one doubts his intelligence. He also figured out that now is the right time to peddle his book too, when there is debate going on about demonitization. Plus ideologyically he wasn't comfortable with the BJP. So hitting two birds with one stone, peddle his book & also attack the government using the halo the Indian media had built for him. He knows the effect of timing.

"It's unclear how the Rs 3 lakh crore number has been arrived at... even if it is a fairly accurate estimate, which it probably is, the department will take about two years before it begins to verify the explanations (that depositors offer). In next few months, the assessments pertaining to notices which were sent in September 2015 (for the financial year 2014-15) will have to be dealt with as these will get time-barred in December 2017," said a person familiar with the matter.

1. The RBI governor's independence on monetary policy which helps to balance the two sometimes conflicting goals - price stability and growth. I agree with RR that price stabilty is more important in India. Our problems are supply side not lack of demand. So growth with come by reforming factor markets, building infrastructure, better tax administration and better governance - ie supply side. Lower interest rates are not the solution. There is a common mistake in many economies of asking monetary policy to do the work of fiscal policy. Thats wrong. And to the extent RR stood up to that it was good. There is always a healthy tension between the finance ministry and RBI. Its good. He was also right in calling for reform of bank balancesheets and crony capitalism which has riddled PSU banks with unperforming corporate loans. There has been HUGE corruption over the last 10-15 years at PSUs with full orders from the govt. JP, Mallaya etc are just two manifestations of that.

2. But his comments on non RBI and monetary policy issues like tolerance etc were wrong. Central Bank governors are expected to be 100% politcially neutral. Infact a good governor anyhwere in the world is a quiet one, from a media perspective even a lack lustre one. This is where he did a lot of damage.

wasn't RR the CEA to the GoI when the congis, including interstellar, galaxy wide financial wonderkind MMS, were making merry with the NPA fiasco??

When he was appointed the CEA to the finmin in august of 2012, he seems to have kept very quiet about the NPAs that were on going at that time as well as all the scams that were dragging the economy down.

1. The RBI governor's independence on monetary policy which helps to balance the two sometimes conflicting goals - price stability and growth. I agree with RR that price stabilty is more important in India. Our problems are supply side not lack of demand. So growth with come by reforming factor markets, building infrastructure, better tax administration and better governance - ie supply side. Lower interest rates are not the solution. There is a common mistake in many economies of asking monetary policy to do the work of fiscal policy. Thats wrong. And to the extent RR stood up to that it was good. There is always a healthy tension between the finance ministry and RBI. Its good. He was also right in calling for reform of bank balancesheets and crony capitalism which has riddled PSU banks with unperforming corporate loans. There has been HUGE corruption over the last 10-15 years at PSUs with full orders from the govt. JP, Mallaya etc are just two manifestations of that.

2. But his comments on non RBI and monetary policy issues like tolerance etc were wrong. Central Bank governors are expected to be 100% politcially neutral. Infact a good governor anyhwere in the world is a quiet one, from a media perspective even a lack lustre one. This is where he did a lot of damage.

wasn't RR the CEA to the GoI when the congis, including interstellar, galaxy wide financial wonderkind MMS, were making merry with the NPA fiasco??

When he was appointed the CEA to the finmin in august of 2012, he seems to have kept very quiet about the NPAs that were on going at that time as well as all the scams that were dragging the economy down.

so this guv RBI was all about UPA good, NDA bad??

IMO Raghuram Rajan was the first to raise the issues of NPAs and India's crony capitalism.

Vidur's post earlier on this page, on RR, sums up my views - RR was my senior at IIM Ahmedabad.

As CEA he could and should have raised the NPA issue. Technically, the RBI is an interested party as their director on the board of each of the banks that endorsed the loans that led to NPA's. The CEA has to be a watchdog and flag it, in case the RBI is reluctant to do so.

Central bankers have to stay out of the limelight. The best central banker is someone whose name is unknown to most of the public and is quoted only when he announces policy decisions. That's the opposite of an academic, where you have to solicit media attention to get published.

RR neither resigned, nor was asked to go. His term ended. The main point of disagreement, AFAIK, was weather he could have a shorter 2nd term, as Univ of Chicago wanted him back and could not release him indefinitely. It is like saying if the Govt does not automatically give the President, CJ, Governor etc a 2nd term, the govt is fascist/intolerant etc.

i dont understand how is it the role of the CEA to tackle the NPA problem...his role is to advice the government on broader economic issues. Poring over balance sheets of banks was for the then RBI governor's job...even if it was his job, how do we know he hadn't flagged these issues to FM then?..maybe he was ignored as UPA is never known for being proactive(or any worthwhile action to be honest..) On the other hand If this forum's khujli with RR is for his political comments, then i dont have anything to add...

I mean, he did what was the right thing to do when he became RBI governor; he told the banks to stop kicking the NPA can down the road and get their shit together. The banks would have just glossed over these crony capitalist loans to essars, ambanis ,adanis et al for decades if they had a choice.

jpremnath wrote:i dont understand how is it the role of the CEA to tackle the NPA problem...his role is to advice the government on broader economic issues. Poring over balance sheets of banks was for the then RBI governor's job...even if it was his job, how do we know he hadn't flagged these issues to FM then?..maybe he was ignored as UPA is never known for being proactive(or any worthwhile action to be honest..) On the other hand If this forum's khujli with RR is for his political comments, then i dont have anything to add...

I mean, he did what was the right thing to do when he became RBI governor; he told the banks to stop kicking the NPA can down the road and get their shit together. The banks would have just glossed over these crony capitalist loans to essars, ambanis ,adanis et al for decades if they had a choice.

wouldn't you consider NPAs as an economic as well as a serious national issue ??, surely worthy of the attention of the CEA, at least in terms of warning/cautioning the govt of the day that an unpleasant issue of gargantuan proportions was starting to rear it's ugly head??

It was crony capitalism at it's worst, including the total disregard of all banking norms, especially lax on the all important loan against collateral system practised since times immemorial.

What about the continuous risk assessment of factors affecting the Indian economy, isn't it an important part of the CEA's job??

^^ I did not say checking the NPA problem was not CEA's job. I said checking the health of Bank's balance sheets was the RBI governors role. The banks had hidden all the NPAs whitewashed neatly within their reports to RBI all these years. We do not have anything out in public about what was discussed between the then RBI gov, FM and CEA. Thats why i said we dont know if he had raised the health of banks with the FM or govrnr. Tackling NPAs was one of the first thing he did after he became RBI governor if i am not wrong.

jpremnath wrote:^^ I did not say checking the NPA problem was not CEA's job. I said checking the health of Bank's balance sheets was the RBI governors role. The banks had hidden all the NPAs whitewashed neatly within their reports to RBI all these years. We do not have anything out in public about what was discussed between the then RBI gov, FM and CEA. Thats why i said we dont know if he had raised the health of banks with the FM or govrnr. Tackling NPAs was one of the first thing he did after he became RBI governor if i am not wrong.

And that is exactly what he should do as RBI governor and also to resist government tendency (all ove rthe wolrd) to make monetary policy the job of fiscal policy. But a good central bank governor is a very quiet one because their words impact the markets. That is the absolute basic as a cnetral bank governor.

Raghu Ram Rajan's term ended that is all. Rest everything is media speculation.

jpremnath wrote:i dont understand how is it the role of the CEA to tackle the NPA problem...his role is to advice the government on broader economic issues. Poring over balance sheets of banks was for the then RBI governor's job...even if it was his job, how do we know he hadn't flagged these issues to FM then?..maybe he was ignored as UPA is never known for being proactive(or any worthwhile action to be honest..) On the other hand If this forum's khujli with RR is for his political comments, then i dont have anything to add...

I mean, he did what was the right thing to do when he became RBI governor; he told the banks to stop kicking the NPA can down the road and get their shit together. The banks would have just glossed over these crony capitalist loans to essars, ambanis ,adanis et al for decades if they had a choice.

wouldn't you consider NPAs as an economic as well as a serious national issue ??, surely worthy of the attention of the CEA, at least in terms of warning/cautioning the govt of the day that an unpleasant issue of gargantuan proportions was starting to rear it's ugly head??

It was crony capitalism at it's worst, including the total disregard of all banking norms, especially lax on the all important loan against collateral system practised since times immemorial.

What about the continuous risk assessment of factors affecting the Indian economy, isn't it an important part of the CEA's job??

I agree. It is the CEA and MOF job as well. But RBI also has a role to play because prudential regulation of banks is their job.I do not want to make a politcial point here but I know of several cases where PSU banks were forced to lend to bogus companies on orders of the previous political dispensation. The head of a politcial party would herself get involved in this. The central government did not prevent this.

Crony captalism is baked into our system but in the decade from 2004 onwards it got very bad accelearting in 2009 onwards.

chetak wrote:wouldn't you consider NPAs as an economic as well as a serious national issue ??, surely worthy of the attention of the CEA, at least in terms of warning/cautioning the govt of the day that an unpleasant issue of gargantuan proportions was starting to rear it's ugly head??

It was crony capitalism at it's worst, including the total disregard of all banking norms, especially lax on the all important loan against collateral system practised since times immemorial.

What about the continuous risk assessment of factors affecting the Indian economy, isn't it an important part of the CEA's job??

I agree. It is the CEA and MOF job as well. But RBI also has a role to play because prudential regulation of banks is their job.I do not want to make a politcial point here but I know of several cases where PSU banks were forced to lend to bogus companies on orders of the previous political dispensation. The head of a politcial party would herself get involved in this. The central government did not prevent this.

Crony captalism is baked into our system but in the decade from 2004 onwards it got very bad accelearting in 2009 onwards.

That is why the holders of positions like the CEA, RBI guv etc should be possessed of moral and ethical testimonials of considerably hefty size as well as the intellectual honesty to place authoritatively on record the economic facts before the powers that be.

Among other things, they essentially function as long range early warning radars as well as coal mine canaries to effectively predict risks due rising economic/financial headwinds, wherever they may rise, if deemed as risks affecting the country and also to watchdog the local financial/economic environment on a substructure basis.

Its their job to recognise, plan, advise and deliver policies for risk mitigation or risk avoidance/transfer as may be decided after consultations with the FinMin.

Of course, the execution of any such strategy is the prerogative of the FinMin.

jpremnath wrote:i dont understand how is it the role of the CEA to tackle the NPA problem...his role is to advice the government on broader economic issues. Poring over balance sheets of banks was for the then RBI governor's job...even if it was his job, how do we know he hadn't flagged these issues to FM then?..I mean, he did what was the right thing to do when he became RBI governor; he told the banks to stop kicking the NPA can down the road and get their shit together. The banks would have just glossed over these crony capitalist loans to essars, ambanis ,adanis et al for decades if they had a choice.

The CEA does not have to tackle NPA's, but he is expected to flag it if they present a risk to the economy - which they did. He does not claimto have done so, in is interviews. I think we can all agree that NPA's arose in the UPA regime, due largely to crony capitalism. RR could well have commented on this but chose not to.Even as RBI Gov, when he asked the banks to come clean on NPA's, he prevailed on the SC, not to `name and shame' the defaulters. As a resultat least a year was lost in acting against them by invoking the bankruptcy code. Hence, the comments on NDA, mostly on matters outside his purview, were inappropriate, even if he felt the need to comment more on govt functioning, than any of his predecessors.

A central banker, when his views on a major govt policy (like DeMo)are solicited, is expected to be conservative and be a `devil's advocate', pointing out all possible risks. That has been hyped by the media as `Rajan warned that Demo would be a disaster etc'. If RR really felt thatthe policy was completely wrong, he could have resigned earlier - which would have truly given him the high moral ground and made him the darling of the Cong/Liberal/Western crowd. His only actual criticism AFAIK, was that there would be a short term disruption and the benefits are unknown, both of which are factually correct.